Economists share views on Thailand's biggest problems

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Economists share views on Thailand's biggest problems
Erich Parpart
The Nation


Ekniti Nitithanprapas

Global factors, education, labour woes cited

BANGKOK: -- Three economists gave an overview of what to expect for the future and the problems that Thailand is currently facing at a seminar held yesterday by the Thammasat Economics Association.

Ekniti Nitithanprapas, deputy director-general of the Finance Ministry's Fiscal Policy Office, told the "Thailand's Biggest Questions: How to Prosper" seminar that the external factors from the giants of the world's economy that will affect Thailand were lower foreign demand, currency fluctuation, increased interest rates and falling prices for agriculture products. Since Thailand depends so much on exports, every crisis and whatever decisions the giant markets make will affect its economy. The United States, the European Union, China and Japan account for 65 per cent of the world's economy.

The US Federal Reserve has signalled that it will ease off on its latest round of economic stimulus known as quantitative easing. This has led to a decrease of activity and more money being pulled back to the US economy. This influx of money causes the US dollar to fluctuate, and if it is bouncing up and down, the baht will do the same.

The next due date for the US to pay up on its debts is in February. The last time, its short-term interest rate skyrocketed and eventually its long-term interest rate followed. This spelled disaster for countries that took out loans from the US because they had to pay them back with more interest. Thailand was one of them.

The EU market is currently unstable because of the reshuffling of Germany's government, so the European Union is not importing as much as before. China is holding back on its economic expansion. Its market growth has decelerated from 10 per cent to 7 per cent.

Japan, the biggest investor in Thailand, is experiencing an unstable economy since its central bank decided to flood the market with more money. This has led to the depreciation of the yen, and eventually this will lead to an increase in imports. But if the yen depreciates more than the baht, coupled with the prospect of a recession next year in Japan, this will create problems for Thailand because the Japanese will stop investing.

Archanun Kohpiaboon, an assistant professor of economics at Thammasat University, said his main concern was how the government will choose to spend the Bt2 trillion it plans to borrow for infrastructure projects. This was followed by the impact of information technology and energy on the economy. Political turbulence might affect the economy in the long term.

Kirida Bhaopichitr, senior economist at the World Bank, believes that Thailand's biggest problem is its education system and shortage of highly skilled workers. And most of the highly trained workers it does have are wrongly allocated.

"Business cannot find suitable candidates to hire because of unskilled workers," she said.

"Our education system is worrisome since the gap between the grades of students from rural and urban areas is far too wide and our children's English capability is lower than many of our neighbours at the moment," she said. On the sidelines of the seminar, Kirida said the World Bank had lowered its forecast for growth of Thailand's gross domestic product this year from 4 per cent to 3 per cent because exports and the numbers from the third quarter were lower than expected.


-- The Nation 2013-11-22

[Thai at Heart]

Corruption is the beginning, middle and end of about every point these guys raise.

[NongKhaiKid]

Economist 1 - " I think we have a problem " ( no reference to Houston ).

Economist 2 - " I think you're right. Is it lunchtime ? "

[lemoncake]

Economist 1 - " I think we have a problem " ( no reference to Houston ).

Economist 2 - " I think you're right. Is it lunchtime ? "

You are spot on. I was expecting a proper forecast but read nothing but kids talk.

[selftaopath]

Thailand functions PERFECTLY to insure that the rich and powerful remain rich and powerful. It's really a monumental strategy and brilliant. Its impact on the average Thai is a very different issue however.

[arthurboy]

The usual handwringing blah blah blah and stating the bleedin' obvious.

So, what next?

Nothing.

sent from my hippo phone

[Ricardo]

Thailand's biggest problem is surely that the current government is even less competent than usual, no long-term planning exists, best just sell-off the whole country to Singapore or Malaysia ?

Sadly I fear that instead, Thailand is destined to be a supplier of lower-cost labour to the rest of ASEAN, and a convenient geographical-hub for transport-routes within the region, nothing more.

Not to say that the country can't make a reasonable living, from doing those things, and growing rice.

Edited November 22, 2013 by Ricardo

[Thait Spot]

As far as I can see, all the metrics for the financial health of Thailand in the short and medium term are heading south

[belg]

a: i think we have a problem

b: sure, let's borrow 2.2 trillion, the debt will help us all

[lemoncake]

Thailand functions PERFECTLY to insure that the rich and powerful remain rich and powerful. It's really a monumental strategy and brilliant. Its impact on the average Thai is a very different issue however.

Spot on, do keep in mind, during crashes most rich do get super rich or more rich at least.

Middle class are the ones who actually suffer, while the rich buy up all they can as they are the only ones with money.

[ggold]

Economist 1 - " I think we have a problem " ( no reference to Houston ).

Economist 2 - " I think you're right. Is it lunchtime ? "

You are spot on. I was expecting a proper forecast but read nothing but kids talk.

wait till kitirat makes a statement to the contrary!

[Ulic]

What a BS nothing report.

[JoeThePoster]

On the sidelines of the seminar, Kirida said....

My comment from the sidelines of the sidelines is that the rich will continue to piss on the middle class and some of it might trickle down to the poor.

[JoeThePoster]

What a BS nothing report.

I get better stuff from my barber, jing jing.

[sjjmmi]

Rich + Poor = Thailand's problems

[MaxLee]

Thailand's biggest problem is surely that the current government is even less competent than usual, no long-term planning exists, best just sell-off the whole country to Singapore or Malaysia ?

Sadly I fear that instead, Thailand is destined to be a supplier of lower-cost labour to the rest of ASEAN, and a convenient geographical-hub for transport-routes within the region, nothing more.

Not to say that the country can't make a reasonable living, from doing those things, and growing rice.

No, the Burmese are taking the "labor jobs" in Thailand, because factory businesses don't want to pay the 300 Baht daily wages, nor do they intend to pay fresh graduates the 15,000 Baht based salary.

And the thing is, those trillion Kachillians of so called graduates who graduate with so called qualified degree, which aren't worth anything anyway in an international standard expectations, don't want to soil their hands with such "dirty work anyway" in a society where office jobs are becoming less and less and less available due to the higher cost of labor AND living, unless if course you have an influential father, mother or relative who would hire their spoiled brat anyway...

There are many jobs available in Thailand, but the majority of the middle and rich class don't want to do them because it makes them lose face, so they let the ASEAN scum aka Burmese or Cambodian drifters deal with it.

[MaxLee]

Accidental double post, due to network problems and panic refreshing...

Edited November 23, 2013 by MaxLee

[takkatan in the land]

Some thais often feel so proud of their country that are not interested at all to listen foreigners opinion or way of thinking.

And one thing they often forget is that they are not alone in the world, consequently they can not act with the complete unconcern

and careless upon everthing is not Thai.

In a couple of words evolution or die.